It was not too long ago when many were quick to dismiss online shopping as a mere fad.  Very few — if any at all — held on to this assumption for long.

Technology spending in the global retail sector has ballooned in recent years. Experts attribute the growth to stronger consumer confidence and the robust expansion of digital commerce. 

That European online market revenues reached a value of US $281.5 billion in 2016 should suffice as proof.  

With so much online shopping going on, one easily assumes that crooks have espied new opportunities to make money. 

This is why the European authorities are taking steps to institute stronger measures to curb the incidence online fraud.  

Stronger Security
European authorities are taking take steps to institute stronger measures to curb the incidence online fraud. (Photo: Pete
Linforth from Pixabay)  

Strong Customer Authentication

Recently, the nations of the European Economic Area (EEA) moved to update online security procedures for retailers selling across the continent. 

Strong Customer Authentication (SCA) is a requirement of the EU’s Revised Directive on Payment Services (PSD2). The new regulation will help reduce online fraud. It will take effect on September 14.

The SCA uses the 3DS 2.0 protocol — an improvement over Europe’s previous 3DS 1.0 authentication procedure. Like its previous iteration, the 3DS 2.0 protocol sends you to a page to confirm who you are.

The process ensures proper authentication by using a wider range of data and bio-metric authentication. 

Are you Ready?

The SCA requires customer authentication based on two or more elements. 

The elements are categorised as knowledge (something only the user knows), possession (something only the user possesses) and inherence (something the user is). Two of three will do.  

The SCA ensures proper authentication by using a wider range of data.
The SCA ensures proper authentication by using a wider range of data and bio-metric authentication. (Photo: Pete
Linforth from Pixabay)

Despite strident criticism from companies like Visa, many agree the SCA will improve online security. 

The EU even claims the new security protocol is easier and less clunky than previous authentication procedures, allowing better customer experience. 

However, the results of a study commissioned by Mastercard indicate that 75 percent of online merchants are likely to be unaware of the new security standard. 

Have you heard of the SCA? Are you ready for it?  Do you think the new protocol will impede the growth of the online retail industry?